Back in May, we wrote about legislation passed in Missouri that “establishes procedures for asserting a mechanic’s lien against certain residential real property.” This legislation changes the Missouri mechanic lien and notice requirements for certain projects, and it’s important to understand the new law.
Well, the end of August has come so quickly, and the Missouri lien law change is now in effect.
Here is our summary of the important changes that was posted back in May:
Most of the changes affect a claimant’s lien rights on residential property that is being sold. Presumably, the state legislatures were concerned about innocent purchasers of residential property getting stuck with mechanics liens that weren’t filed at the time of closing, or were filed too near the closing date to get picked up in the title search. To address this issue, they added the following procedure:
Step 1: The property owner intended to sell the residential property is to file (and post at the job site) a Notice of Intended Sale, which identifies the closing date for the residential property.
Step 2: All claimants (subs, contractors, suppliers) who have lien rights must file a “Notice of Rights” at least 5 days before the posted sale date.
Claimants must keep in mind two tricky features of the new rule: (1) If the closing date changes, it doesn’t affect when the Notice is due — it’s still due at least 5 days before the posted closing date; and (2) This does not effect the claimant’s lien deadline, before or after filing the Notice of Rights (depending on timing), the lien is still due and must still be separately filed.
In addition to this summary, you can also read about the change on the Lien Law Online Blog here: Missouri Lien Law Alert.